China called on Russia on Thursday to explain how a Chinese cargo ship sank in Russian waters after reports it was fired on by the Russian military.

Seven Chinese sailors were missing after the "New Star" sank on Saturday in stormy seas off Vladivostok and after a Russian warship shot at least 500 rounds into it, the official China Daily newspaper said, quoting a Chinese-language paper which in turned quoted a Russian newspaper.

The "New Star" was held at the Russian port of Nakhodka earlier this month, suspected of involvement in smuggling, before it left without permission last week, the China Daily said.

"We hope they continue with the search and rescue operations for the missing sailors and clarify the reason (for the incident) as soon as possible."

China says three Chinese crew members were rescued and seven were missing.

In video footage of the incident broadcast on Russian television, the rattle of gunfire could be heard, with authorities there claiming the ship was given adequate warning.

"The 'New Star' captain was called by radio, border guard boats sent light signals, a special flag demanding to stop was raised and a warning shot was fired," a prosecutor in Nakhodka, Alexander Selentsov, told Russia's Interfax news agency.

Interfax also quoted a border guard captain as saying "the foreign vessel disregarded authorities' demands and was fleeing to the Chinese economic zone at a full speed."